SAN ANTONIO – Despite a small bump in crude oil prices on Wednesday, prices remain near a seven-year low, sitting near $40 a barrel.
"Unfortunately, we've lost a number of jobs over the last year and a half and I’m afraid that trend is going to continue in the near future,” said David Porter, chairman of the Texas Railroad Commission.
Porter, along with other oil and gas industry leaders discussed the issues facing their industry at the first annual State of Energy luncheon. The luncheon was hosted by Shale Oil and Gas Business Magazine and the San Antonio Hispanic Chamber of Commerce.
Other speakers included Tim Baer, who represented the Encana Corporation, a company that deals in oil and natural gas and operates in the Eagle Ford Shale. Baer admitted that times had become tougher and margins were thinning.
"We try to manage with what we have,” Baer said. "We work to try to reduce our costs."
For other companies, that has meant cutting jobs. Baer said Encana has escaped job reduction for now.
"We're always looking at it, but hopefully at this point, that's not going to be the case,” he said.
Layoffs, in general, however, are becoming more and more common in the industry. It was just two years ago that crude oil prices sat at over $100 a barrel. Now, prices are hovering around $40 a barrel.
While it may seem bleak for some, the news is certainly not all bad.
"There's abundant natural gas right here in South Texas,” said Tom Forbes, with Texas for LNG (Liquefied Natural Gas).
Natural gas, too, has seen low prices, but recent regulatory changes have allowed a new money source to blossom from the commodity. The export of liquefied natural gas is expected to soon take off. In fact, seven plants that would do just that are either being built along the Texas coast or are in the works.
"We've seen one report that estimates that perhaps as many as 150,000 jobs would be created between now and 2035,” Forbes said.
New technology to streamline production was also presented to the attendants at the State of Energy luncheon. Technology in the oil fields is expected to help companies to save money.
Despite the current downturn, most agreed the oil and gas industry will eventually make a comeback, as it has in the past. It is also expected to remain a large part of the South Texas economy.